Exclusion of Land for Construction of Low Income Community Housing to Obtain Location License

Under the Government Regulation No. 64 of 2016 on Construction of Low Income Communities Housing (“GR No. 64/2016”), the housing for low income communities (“LIC Housing”) shall be constructed not more than 5 hectares, and at least 0.5 hectare, provided that the location of LIC Housing is in accordance with the spatial plan. The GR No. 64/2016 further stipulates that the location license is not required for the implementation of LIC Housing construction.

This exclusion however does not in line with the provisions in the Minister of Agrarian and Spatial Planning/Head of National Land Agency Regulation No. 5 of 2015 on Location License (“Minister Regulation No. 5/2015”), since the Minister Regulation No. 5/2015 does not exclude a land for LIC Housing construction from the obligation to have a location license. Location license is a license granted to a company for acquiring the necessary land for its investment, which also applies as the license for the transfer of rights, and uses the land to conduct its business investment.

In order to adjust the provisions as set out in the GR No. 64/2016, the Minister of Agrarian and Spatial Planning has amended the Minister Regulation No. 5/2015 through the Minister of Agrarian and Spatial Planning/Head of National Land Agency Regulation No. 19 of 2017 (“Minister Regulation No. 19/2017”). Under the Minister Regulation No. 19/2017, the land that will be used for the construction of LIC Housing does not need a location license, provided that the land is not more than 50,000 m2.


Ivor Pasaribu

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